Broker snap: Panmure optimistic about easyJet's long-term prospects

Panmure Gordon retained its 'buy' rating for airline group easyJet, saying that it remains optimistic about the long-term prospects of the business after its strong annual results, unexpected special dividend and decent outlook.The company reported a 50.9% increase in full-year pre-tax profits to £478m, "towards the top end of easyJet's guidance", said analyst Gert Zonneveld, in spite of rising costs due to higher charges at regulated airports.Meanwhile, total revenue rose 10.5% to £4,258m and passenger numbers were up 4% at 60.8m. easyJet also announced a special dividend of 44.1p per share equal to a payout of around £175m, on top of the normal dividend of 33.5p.Looking ahead, the company said it expects revenues per seat to increase marginally in the second half despite the timing of Easter and travel restrictions to Egypt, while unit costs excluding fuel should rise 2%.Zonneveld said: "We are not concerned about longer-term pricing pressure as there does not appear to be significant new capacity entering the short-haul market. The company has a strong structural cost advantage over most of its competitors, creating a highly attractive value proposition. "We expect seat revenues to rise in the coming years, primarily driven by modest capacity growth, maturing routes and bases, a growing proportion of business passengers and a more rigorous route management. Costs (ex-fuel) appear to be under control."The broker maintained its 1,500p target price for the stock.The stock was 6.35% higher at 1,335.8p by 10:20 on Tuesday.BC